Premises and Equipment

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Premises and Equipment

Note 4 – Premises and Equipment

The following table presents the components of premises and equipment as of the periods indicated:

(Dollars in thousands)	June 30, 2021		December 31, 2020
Land	$	3,936	$	3,936
Buildings and improvements	11,629		14,350
Furniture, fixtures and equipment	16,612		17,669
Construction in progress	538		28
Leasehold improvements	3,079		3,079
	35,794		39,062
Accumulated depreciation	(14,761)		(14,126)
Net premises and equipment	$	21,033	$	24,936

The Company leases certain premises and equipment under operating and finance leases.

At June 30, 2021, the Company had lease liabilities totaling $18.0 million, of which $17.9 million was related to operating leases and $0.1 million was related to finance leases, and right-of-use assets totaling $17.1 million, of which $16.8 million was related to operating leases and $0.3 million was related to finance leases, related to these leases. Lease liabilities and right-of-use assets are reflected in other liabilities and other assets, respectively. At June 30, 2021, the weighted-average remaining lease term for finance leases was 1.9 years and the weighted-average discount rate used in the measurement of finance lease liabilities was 2.3%. At June 30, 2021, the weighted-average remaining lease term for operating leases was 12.5 years and the weighted-average discount rate used in the measurement of operating lease liabilities was 2.9%.

At December 31, 2020, the Company had lease liabilities totaling $18.4 million, of which $18.3 million was related to operating leases and $0.2 million was related to finance leases, and right-of-use assets totaling $17.7 million, of which $17.5 million was related to operating leases and $0.2 million was related to finance leases, related to these leases. Lease liabilities and right-of-use assets are reflected in other liabilities and other assets, respectively. For the year ended December 31, 2020, the weighted-average remaining lease term for finance leases was 2.3 years and the weighted-average discount rate used in the measurement of finance lease liabilities was 2.4%. At December 31, 2020, the weighted-average remaining lease term for operating leases was 12.9 years and the weighted-average discount rate used in the measurement of operating lease liabilities was 2.9%.

The following table presents lease costs for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2021		2020		2021		2020
Amortization of right-of-use assets, finance leases	$	14	$	18	$	28	$	36
Interest on lease liabilities, finance leases	—		1		1		2
Operating lease cost	477		577		954		1,121
Short-term lease cost	2		12		3		26
Variable lease cost	9		10		19		20
Total lease cost	$	502	$	618	$	1,005	$	1,205

The following table presents future minimum payments for finance leases and operating leases with initial or remaining terms of one year or more as of June 30, 2021:

(Dollars in thousands)	Finance Leases		Operating Leases
2021	$	59	$	1,820
2022	14		1,822
2023	5		1,724
2024	5		1,705
2025	1		1,722
2026 and thereafter	—		13,001
Total future minimum lease payments	$	84	$	21,794
Less: Amounts representing interest	(1)		(3,921)
Present value of net future minimum lease payments	$	83	$	17,873

Premises and Equipment

Note 4 – Premises and Equipment

The following table presents the components of premises and equipment as of the periods indicated:

(Dollars in thousands)	June 30, 2021		December 31, 2020
Land	$	3,936	$	3,936
Buildings and improvements	11,629		14,350
Furniture, fixtures and equipment	16,612		17,669
Construction in progress	538		28
Leasehold improvements	3,079		3,079
	35,794		39,062
Accumulated depreciation	(14,761)		(14,126)
Net premises and equipment	$	21,033	$	24,936

The Company leases certain premises and equipment under operating and finance leases.

At June 30, 2021, the Company had lease liabilities totaling $18.0 million, of which $17.9 million was related to operating leases and $0.1 million was related to finance leases, and right-of-use assets totaling $17.1 million, of which $16.8 million was related to operating leases and $0.3 million was related to finance leases, related to these leases. Lease liabilities and right-of-use assets are reflected in other liabilities and other assets, respectively. At June 30, 2021, the weighted-average remaining lease term for finance leases was 1.9 years and the weighted-average discount rate used in the measurement of finance lease liabilities was 2.3%. At June 30, 2021, the weighted-average remaining lease term for operating leases was 12.5 years and the weighted-average discount rate used in the measurement of operating lease liabilities was 2.9%.

At December 31, 2020, the Company had lease liabilities totaling $18.4 million, of which $18.3 million was related to operating leases and $0.2 million was related to finance leases, and right-of-use assets totaling $17.7 million, of which $17.5 million was related to operating leases and $0.2 million was related to finance leases, related to these leases. Lease liabilities and right-of-use assets are reflected in other liabilities and other assets, respectively. For the year ended December 31, 2020, the weighted-average remaining lease term for finance leases was 2.3 years and the weighted-average discount rate used in the measurement of finance lease liabilities was 2.4%. At December 31, 2020, the weighted-average remaining lease term for operating leases was 12.9 years and the weighted-average discount rate used in the measurement of operating lease liabilities was 2.9%.

The following table presents lease costs for the periods indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2021		2020		2021		2020
Amortization of right-of-use assets, finance leases	$	14	$	18	$	28	$	36
Interest on lease liabilities, finance leases	—		1		1		2
Operating lease cost	477		577		954		1,121
Short-term lease cost	2		12		3		26
Variable lease cost	9		10		19		20
Total lease cost	$	502	$	618	$	1,005	$	1,205

The following table presents future minimum payments for finance leases and operating leases with initial or remaining terms of one year or more as of June 30, 2021:

(Dollars in thousands)	Finance Leases		Operating Leases
2021	$	59	$	1,820
2022	14		1,822
2023	5		1,724
2024	5		1,705
2025	1		1,722
2026 and thereafter	—		13,001
Total future minimum lease payments	$	84	$	21,794
Less: Amounts representing interest	(1)		(3,921)
Present value of net future minimum lease payments	$	83	$	17,873